EU retaliates for US tariffs on aluminium and steel

The European Commission has responded to the US administration's levies on aluminium and steel, formally approving 'rebalancing measures' on €2.8bn-worth of US exports of agricultural and manufactured goods.

Included on the list of goods targeted by Brussels were products including various types of grain, orange juice, tobacco and some types of motor vehicles and ships for the transportation of goods.

The measures were set to go into effect on 22 June.

Commissioner for Trade Cecilia Malmström said: "The rules of international trade, which we have developed over the years hand in hand with our American partners, cannot be violated without a reaction from our side. Our response is measured, proportionate and fully in line with WTO rules. Needless to say, if the US removes its tariffs, our measures will also be removed."

Brussels was responding to Washington's decision to levy tariffs on €6.4bn-worth of EU exports of aluminium and steel.

Tariffs on another €3.6bn-worth of US goods was postponed until in three years' time or after a positive ruling from the World Trade Organisation's arbitration body, whichever came first.

Findings were also expected by the summer of 2018 from the EC's investigation into the need for safeguard actions to offset the impact that the diversion of steel from the US market might have on the European market.

Commenting on the Commission's anticipated decision, earlier on Wednesday, Oliver Rakau, chief German economist at Oxford Economics, had said: "he EU tariffs are well designed, targeting politically sensitive sectors that will grab media attention while doing close to no harm to Europe's economy.

"However, there is little evidence that they will succeed in discouraging another round of tariff hikes from the US. Higher US car tariffs look increasingly likely."